Adcock: Profit under extreme pressure

Companies / 19 March 2014, 4:45pm

Reuters

A pharmacist counts pills in a pharmacy. File image: Reuters

Johannesburg - South African drugmaker Adcock Ingram said quarterly profit was under “extreme pressure” as debt-laden consumers cut back on self-medication and the weaker rand pushed up costs of imported raw materials.

Adcock has been at the centre of a takeover battle between South Africa's Bidvest and Chile's CFR Pharmaceuticals.

The winner, industrial conglomerate Bidvest, has since replaced Adcock's chairman with Bidvest's chief executive Brian Joffe to help return the company to profitability.

Adcock said it has started re-evaluating its process and structure.

It said it would pay more than 100 million rand in costs related to the failed CFR bid.

Revenue in the quarter to end-February was largely flat, the company said, citing a “concerning” performance from its prescription and over-the-counter portfolio and weaker rand currency.

The company has the largest share of South Africa's market for over-the-counter drugs, most of which are not covered by medical insurance and therefore sensitive to a downturn in consumer spending. - Reuters